‘Repatriate the gold’: German economists advise withdrawal from US vaults | Germany
Germany is facing calls to withdraw billions of euros worth of gold from US coffers due to the shift in transatlantic relations and Donald Trump’s unpredictability.
Germany has the world’s second-largest national gold reserves after the US, of which around €164bn (£122bn) worth – 1,236 tonnes – is stored in New York.
Emanuel Mönch, a leading economist and former head of research at Germany’s federal bank, the Bundesbank, called for gold to be brought home, saying it was too “risky” to keep gold in the United States under the current administration.
“Given the current geopolitical situation, storing so much gold in the US seems risky,” he told the financial newspaper handelsblatt. “In order to achieve greater strategic independence from the United States, the Bundesbank would be well advised to consider repatriating the gold.”
Stefan Kornelius, spokesman for Friedrich Merz’s coalition government, said recently that drawing down gold reserves was not currently being considered.
But Mönch is only the latest in a series of economists and financial experts to argue that such a move would be in line with the greater strategic independence that Europe’s largest economy has sought from the United States in recent months.
Michael Jäger, president of the European Taxpayers’ Association (TAE) and the German Taxpayers’ Association, also said that Berlin should take action and argued that the US’s desire to seize Greenland should focus minds.
“Trump is unpredictable and does everything to generate revenue. That’s why our gold is no longer safe in the Fed’s vaults,” Jäger said. Rheinische Post. “What will happen if the Greenland provocation continues?… The risk that the German Bundesbank will no longer be able to access gold is increasing. Therefore, it needs to send its reserves back to its country.”
Jäger said he wrote to the Bundesbank and the finance ministry last year, urging them to “bring our gold home”.
Until recently, the gold issue was in the hands of the far-right Alternatif für Deutschland (AfD), which has repeatedly demanded the return of the gold for patriotic reasons. However, it gradually infiltrated mainstream discourse.
Katharina Beck, finance spokeswoman for the opposition Greens in the Bundestag, also spoke in favor of relocating the gold bars, calling them “an important pillar of stability and confidence” that “should not become pawns in geopolitical disputes”.
But Clemens Fuest, head of the Institute for Economic Research (Ifo) and one of the country’s most prominent economists, warned against such a move, telling Rheinische Post that it could lead to unintended consequences and “only fuel the current situation.”
Germany’s total gold reserves are worth almost 450 billion Euros.
Just over half is held at the Bundesbank in Frankfurt am Main, 37% in the vaults of the US Federal Reserve in New York and 12% at the Bank of England in London, the global hub of gold trading. The Bundesbank announced that it regularly inspects the gold stocks it keeps in storage.
Speaking at the fall meetings of the International Monetary Fund (IMF) in Washington DC last October, Bundesbank chief Joachim Nagel assured attendees that there was “no reason to worry” about German gold held at the US Federal Reserve.
Frauke Heiligenstadt, spokeswoman for the parliamentary group on financial policy of the Social Democrats, the government’s junior partners, said she understood concerns about gold reserves but said there was no need to panic.
“Germany’s gold reserves are quite diverse,” he said. Since half of it is in Frankfurt, “our mobility is guaranteed”. He added that it makes sense to have gold in New York because “Germany, Europe and the United States are closely linked in terms of fiscal policy.”
But amid Trump’s toughening rhetoric against his western partners, a growing number of Christian Democrats in Merz are speaking out in favor of relocation.
“Due to the Trump administration, the United States is no longer a reliable partner,” Ulrike Neyer, professor of economics at the University of Düsseldorf, told Rheinische Post.
